BrickAtlasCalculatorsCash-on-cash
Cash-on-cash return calculator
Divide one year of cash flow by the cash you actually put in. This is the leveraged cash-on-cash return on a BrickAtlas buy-and-hold memo.
Calculate cash-on-cash
Enter the purchase, loan, rent, and expenses Analyst uses for a rental. Cash invested is the down payment, rehab, and purchase closing. The return updates as you type.
Purchase and loan
Income
Annual operating costs
Percent of gross rent
Cash-on-cash return
4.1%
$3,550 annual cash flow ÷ $86,800 cash invested.
- Gross rent
- $25,200
- Vacancy
- $1,260
- Operating expenses
- $9,032
- NOI
- $14,908
- Annual debt service
- $11,358
- Monthly cash flow
- $296
- Purchase closing
- $5,550
- Cash invested
- $86,800
How cash-on-cash is calculated
Cash-on-cash = annual cash flow ÷ total cash invested
Annual cash flow is effective rent minus operating expenses minus mortgage payments. Cash invested is the down payment plus rehab plus purchase closing. Purchase closing defaults to 3% of the price. The mortgage changes this return. It does not change cap rate.
The sample uses a $185,000 purchase, $46,250 down, and $35,000 of rehab. Annual cash flow is $3,550 on $86,800 cash invested, so cash-on-cash is 4.1%.
Closing costs count
Cap rate ignores closing costs. Cash-on-cash includes the default 3% purchase closing in the cash you brought, along with the down payment and rehab.
Debt is already in the numerator
Principal and interest reduce annual cash flow before the division. A lower rate or a larger down payment moves this return even when NOI stays put.
Appreciation stays out
Equity from appreciation and principal paydown is a different line on the memo. This ratio is only the cash the property pays you this year.
What this number doesn’t tell you
Cash-on-cash is the yield on the cash left in a financed rental. It does not choose the market, the strategy, or whether the property can clear a refinance. BrickAtlas runs that loop after the screen: persona, metros, listings, then a strategy-aware Investment Memo.
Yield before financing
Two deals can share a cash-on-cash return and still have different cap rates. Analyst reports purchase-only cap rate next to this return so the unlevered yield stays visible.
Whether the loan is covered
A high cash-on-cash return can sit on a thin DSCR. Lenders care about NOI divided by the annual mortgage, which this page’s return does not show as a coverage ratio.
Whether this market fits
A strong return in the wrong metro is still the wrong next investment. Explore ranks cities with Atlas Score and persona Match before you underwrite an address.
FAQ
- What is cash-on-cash return?
- Cash-on-cash return is annual cash flow divided by total cash invested. A property with $12,000 of annual cash flow and $100,000 of cash invested has a 12% cash-on-cash return. BrickAtlas computes that ratio in code and shows it as a percent.
- What counts as cash invested?
- Down payment, rehab budget, and purchase closing costs. Purchase closing defaults to 3% of the purchase price. The loan balance is not cash invested. Cap rate uses the purchase price instead, so the two ratios answer different questions.
- Is this the same cash-on-cash as BrickAtlas Analyst?
- Yes. This page uses the same annual cash flow and the same cash-invested basis as a buy-and-hold memo. On that memo, hold ROI is this same ratio.
- What cash-on-cash return does BrickAtlas treat as strong?
- For a leveraged hold, BrickAtlas marks cash-on-cash under 5% as weak, from 5% up to 8% as acceptable, and 8% or higher as strong. The bands are a screen. Vacancy, condition, and market fit still decide the deal.
- Where should I go after a cash-on-cash screen?
- If the return is interesting, open Analyst on the address for DSCR, strategy, and an Investment Memo. If you are still choosing a city, start in Explore and let persona Match narrow the metros.
Take the return into a full memo
Set a persona, explore metros that match, and underwrite the address with cash flow, DSCR, and cash-on-cash in one place.
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